Overview:
The overall positive outcome was largely fueled by strong performance in taxes on international trade and transactions, which exceeded projections by Shs 13.48 billion, reaching Shs 942.94 billion for the month.
Uganda’s tax revenue collections for May 2025 closed with a slight surplus of Shs 2.00 billion against the planned target of Shs 2,374.01 billion, according to the Ministry of Finance’s latest Performance of the Economy report.
The overall positive outcome was largely fueled by strong performance in taxes on international trade and transactions, which exceeded projections by Shs 13.48 billion, reaching Shs 942.94 billion for the month. This boost was mainly attributed to higher-than-expected petroleum duty collections amid rising fuel consumption and imports.
Corporation tax collections also posted a healthy surplus of Shs 73.74 billion, supporting the government’s fiscal position. However, these gains were offset by significant shortfalls in Pay As You Earn (PAYE) and withholding tax receipts, which dragged down the overall income tax performance. The shortfall in income tax resulted in an aggregate deficit of Shs 1.75 billion for May.
Consumption taxes also underperformed, amounting to Shs 629.00 billion and falling short of the target by Shs 16.32 billion. Both Value Added Tax (VAT) and excise duty revenues came in below expectations. Major contributors to this shortfall included weaker collections from key taxable items such as wine and spirits, sugar, and phone talk time.
Meanwhile, non-tax revenue collections totaled Shs 177.10 billion, achieving 89.5 percent of the target Shs 197.75 billion for the month. This reflects ongoing challenges in meeting non-tax revenue goals.
The Ministry of Finance has called for continued efforts to broaden the tax base, enhance compliance, and address shortfalls to sustain fiscal stability amid growing public spending demands.